MARC Projects Malaysia’s Growth At 4.3% In 2026, Ringgit To Hit 3.93
Malaysia is set to maintain economic resilience with growth projected at 4.3% in 2026, according to an outlook report by MARC Ratings. This positive forecast is underpinned by steady domestic demand and sustained investment, supported by moderate inflation and stable income growth.
On the external front, the economy is expected to benefit from improving global demand and a surge in exports driven by the adoption of artificial intelligence (AI). Malaysia is seen as well-positioned to capture export gains and attract capital inflows from the global AI capital expenditure cycle.
Currency and Fiscal Outlook
The Malaysian ringgit is anticipated to continue its strong performance, which saw it rally 10.1% against the greenback by the end of 2025, making it Asia’s best-performing currency. MARC Ratings projects the ringgit will appreciate to approximately 3.93 USDMYR by mid-2026. This expectation is supported by:
- Steady foreign portfolio inflows.
- Subdued inflation levels.
- An improving spread between Malaysian Government Securities (MGS) and US Treasuries (UST) in Malaysia’s favour.
- Firmer external market sentiment.
In terms of fiscal health, the nation is expected to sustain steady foreign portfolio inflows, backed by resilient domestic fundamentals, ongoing institutional reforms, and continued fiscal consolidation. The fiscal deficit is projected to narrow to 3.5% of Gross Domestic Product (GDP) in 2026, down from 3.8% in 2025. Additionally, the 10-year MGS yield is projected to anchor between 3.35% and 3.40% by the close of 2026.
Global Context
The domestic outlook contrasts with a global environment where growth is expected to moderate in 2026, despite major economies having avoided a recession through the end of 2025. Global growth momentum is currently limited by labour supply and demographic trends. Key risks to global capital flows and market conditions will remain tied to shifts in monetary policy, trade dynamics, and geopolitical developments.
